“Save GrafTech” Responds to Settlement Proposal Rejection by Graftech
International

NEW YORK--(BUSINESS WIRE)--Nathan Milikowsky, a former GrafTech International Ltd. (“GrafTech” or
the “Company”) director and a holder of over 15 million GrafTech shares,
or over 11.2%, of the common stock, today sent the below letter to
GrafTech in response to the Company’s rejection of Save GrafTech’s
latest settlement proposal.

Save GrafTech has nominated five directors for election to the Board of
Directors of GrafTech at the Company’s Annual Meeting of Stockholders on
May 15, 2014.

Two questions that I have been asked by shareholders have been clearly
answered by recent events. First, am I willing to reach a settlement?
Second, did the GrafTech Board have a basis for not renominating me as a
director?

Save GrafTech also proposed a solution to address any concerns the
Company might have about my suitability to rejoin the Board. Under our
proposal, as described in the attached term sheet we previously sent
you, the Board would promptly retain an independent law firm to review
the undisclosed findings of the Special Committee’s prior investigation.
That independent firm would determine whether I met GrafTech’s standards
for membership on the Board of Directors. Should the law firm conclude
that I did not, I would promptly resign from the Board.

Having served on the Board with your current directors, I was not
surprised that GrafTech rejected this eminently reasonable offer and
responded in less than eight hours with an unacceptable counterproposal.
However, I was surprised that this rejection clearly betrays the Board’s
lack of confidence in the “findings" of its own Special Committee
investigation, which was the pretext for excluding me from continuing to
serve as a director in 2013.

If the evidence of my “misconduct" is so compelling, why wouldn’t it
stand up to an independent third-party review? We gave the GrafTech
Board the opportunity to have their decision not to renominate me tested
by an independent, impartial party. GrafTech’s rejection, which is
carefully and disingenuously crafted to appear reasonable, makes it
crystal clear that the Board does not stand behind the Special
Committee’s findings. In fact, their rejection of my proposal supports
what I have been saying all along – that the Special Committee’s
so-called investigation was a total waste of time and significant money
that provided absolutely no support for their actions, allegations and
smears. While Save GrafTech proposed an objective assessment of the
allegations of the GrafTech Board (as outlined in the Company’s
preliminary proxy statement) through a simple process that would take
only approximately two weeks to complete, the current Board instead
demanded an elaborate litigation-like exercise that would take a minimum
of two years to complete and would needlessly divert substantial funds
from GrafTech’s shareholders to lawyers engaged in a “fishing
expedition.” Reinvestigating the same purported leak through a judicial
or arbitration process, as GrafTech now demands, is a transparent stall
tactic designed to create a significant delay to my rejoining the Board.

Nevertheless, it is noteworthy that the Board is not categorically
opposed to accepting me as a director, albeit under unduly burdensome
and unreasonable terms. GrafTech’s rejection concedes that the Board has
abandoned its prior position that it could not accept any settlement
offer that would include me rejoining the Board. Shareholders should
view this change as further evidence that the allegations in GrafTech’s
preliminary proxy statement are utterly false. I have total confidence
that an independent law firm would conclude that the Special Committee’s
prior investigation of me provided no support whatsoever for its finding
that I was not qualified to serve as a director.

Finally, shareholders should note the lengths to which this Board will
go to protect Mary Cranston, an individual with a history of launching
smear campaigns against those she perceives as obstacles or threats. A
simple Internet search reveals a wealth of information reporting her
history of bullying and underhanded personal attacks. The Board’s
judgment must be questioned in allowing her to continue as Lead
Independent director, especially given the Company’s chronic
underperformance and its stated intention for Cranston to succeed Craig
Shular as Chairman.

It is unfortunate that our settlement discussions have been scuttled by
GrafTech’s inability to accept an exceptionally reasonable offer, which
included minority representation for the Save GrafTech slate as well as
a significant two-year standstill provision. I continue to believe that
many other GrafTech shareholders agree with me that the GrafTech Board
needs to be reconstituted – and that, in order to bring about meaningful
change, Save GrafTech’s level of Board representation must reflect the
scale of the problems the Company is facing. I look forward to providing
shareholders with a platform for truly meaningful change at the 2014
Annual Meeting.

Sincerely,

Nathan Milikowsky

SAVE GRAFTECH

SETTLEMENT PROPOSAL TERM SHEET

Board

Save GrafTech proposes the following slate (the “Slate”)
for a newly constituted board of directors of GrafTech International
Ltd. (the “Company”) consisting of the following
directors:

The newly constituted Board will promptly retain an independent
law firm acceptable to the Board and Nathan Milikowsky. That law
firm will not reinvestigate any of the issues previously raised
regarding Mr. Milikowsky. That law firm will report to the
Board, based on its review of the prior investigations, whether
those investigations cause it to conclude, without
qualification, that Nathan Milikowsky in fact did not meet, in
material respects, the then standards for membership on the
Board of Directors of GrafTech. If that law firm concludes
negatively with respect to Mr. Milikowsky, he will promptly
offer to resign from the Board. If the law firm does not
conclude negatively with respect to Mr. Milikowsky, he will be
entitled to remain a director of GrafTech.

Each of Craig Shular, Harold Layman and Mary Cranston will resign
effective immediately.

Standstill

Nathan Milikowsky will agree to support election of the Slate at the
2014 Annual Meeting. Mr. Milikowsky will support the Board nominated
slate at the 2015 annual meeting of shareholders if, sufficiently
prior to January 1, 2015, taking into account any changes to the
director nomination time period, Mr. Milikowsky is (1) nominated for
election to the board of directors at the 2015 Annual Meeting and
(2) Mr. Milikowsky accepts such nomination.

Chairman

The newly constituted board of directors will select the chairman of
the board of directors.

Committees

The board of directors will agree that it will not use committees
or any other device to circumvent the decision making of the board
of directors.

The Nominating and Governance committee will have three members:
(1) David Jardini, (2) a new director elected in 2014 who is
either a Jointly Selected Director or a Save GrafTech Director and
(3) another person selected by the newly constituted board of
directors.

At least one Save GrafTech nominee will serve on all other
committees.

Indemnification

Nathan Milikowsky will be indemnified for his past and future
expenses to the extent he is entitled pursuant to Delaware law and
the Company’s organizational documents.

Stockholders’ Agreement

The parties will terminate all rights and provide a mutual release
of all causes of action under Sections 2 and 4 of the Registration
Rights and Stockholders’ Agreement.

Expenses

The Company will pay one-half of the documented and out of pocket
expenses of Save GrafTech.

Non-Binding

This term sheet is non-binding and for discussion purposes only.
Neither this term sheet, nor the discussions, negotiations or other
activities related to the subject matter hereof create any
obligations, liabilities or duties with respect to any party.